Critical Contrast: Industria de Diseno Textil (OTCMKTS:IDEXY) versus Williams-Sonoma (NYSE:WSM)

Williams-Sonoma (NYSE:WSM) and Industria de Diseno Textil (OTCMKTS:IDEXY) are both large-cap consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, valuation, earnings and risk.

Valuation & Earnings

This table compares Williams-Sonoma and Industria de Diseno Textil”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Williams-Sonoma	$7.81 billion	3.49	$1.09 billion	$9.77	23.65
Industria de Diseno Textil	$45.09 billion	4.19	$7.11 billion	$0.60	25.28

Industria de Diseno Textil has higher revenue and earnings than Williams-Sonoma. Williams-Sonoma is trading at a lower price-to-earnings ratio than Industria de Diseno Textil, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

99.3% of Williams-Sonoma shares are held by institutional investors. 1.1% of Williams-Sonoma shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Williams-Sonoma pays an annual dividend of $3.04 per share and has a dividend yield of 1.3%. Industria de Diseno Textil pays an annual dividend of $0.31 per share and has a dividend yield of 2.0%. Williams-Sonoma pays out 31.1% of its earnings in the form of a dividend. Industria de Diseno Textil pays out 51.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Williams-Sonoma has increased its dividend for 20 consecutive years.

Profitability

This table compares Williams-Sonoma and Industria de Diseno Textil’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Williams-Sonoma	14.73%	53.48%	20.50%
Industria de Diseno Textil	15.54%	33.83%	17.67%

Analyst Recommendations

This is a breakdown of current recommendations for Williams-Sonoma and Industria de Diseno Textil, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Williams-Sonoma	0	8	10	0	2.56
Industria de Diseno Textil	0	1	1	2	3.25

Williams-Sonoma presently has a consensus target price of $245.56, indicating a potential upside of 6.29%. Given Williams-Sonoma’s higher probable upside, research analysts plainly believe Williams-Sonoma is more favorable than Industria de Diseno Textil.

Risk & Volatility

Williams-Sonoma has a beta of 1.47, meaning that its share price is 47% more volatile than the S&P 500. Comparatively, Industria de Diseno Textil has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500.

Summary

Williams-Sonoma beats Industria de Diseno Textil on 10 of the 18 factors compared between the two stocks.

About Williams-Sonoma

Williams-Sonoma, Inc. operates as an omni-channel specialty retailer of various products for home. It offers cooking, dining, and entertaining products, such as cookware, tools, electrics, cutlery, tabletop and bar, outdoor, furniture, and a library of cookbooks under the Williams Sonoma Home brand, as well as home furnishings and decorative accessories under the Williams Sonoma lifestyle brand; and furniture, bedding, lighting, rugs, table essentials, and decorative accessories under the Pottery Barn brand. The company also provides home decor products under the West Elm brand; kids accessories under the Pottery Barn Kids brand; and an organic bedding to multi-purpose furniture under the Pottery Barn Teen brand. In addition, it offers made-to-order lighting, hardware, furniture, and home decors inspired by history under the Rejuvenation brand; personalized products and custom gifts under the Mark and Graham brand; and colorful and vintage-inspired heirloom products under the GreenRow, as well as operates a 3-D imaging and augmented reality platform for the home furnishings and décor industry under the Outward brand. The company markets its products through e-commerce websites, direct-mail catalogs, and retail stores. Williams-Sonoma, Inc. was founded in 1956 and is headquartered in San Francisco, California.

About Industria de Diseno Textil

Industria de Diseño Textil, S.A. engages in the retail and online distribution of clothing, footwear, accessories, and household products. The company sells its products under the Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, and Zara Home brands. It is also involved in the textile manufacturing, logistics, design, insurance, construction, and real estate businesses, as well as provides financial services. The company operates in Spain, rest of Europe, the Americas, Asia, and internationally. Industria de Diseño Textil, S.A. was founded in 1963 and is headquartered in A Coruña, Spain.